State Bank of India, HDFC Bank and ICICI Bank remain named as domestic systemically important banks (D-SIBs) by the Reserve Bank of India.

The RBI’s list of D-SIBs, also known as "too-big-to-fail" institutions, came out on Wednesday. These banks must adhere to specific capital requirements that aim to safeguard the financial system.

Inclusion in the list requires the lenders to maintain higher Common Equity Tier 1 (CET1) in addition to the capital conservation buffer as per the bucket under which it has been classified.

The State Bank of India (SBI) and HDFC Bank will face heightened capital buffer requirements beginning April 1, 2025. 

SBI continues to be in bucket 4, which will require the country's largest lender to keep an additional CET1 of 0.80%, as per the list. The additional capital buffer will increase from its current 0.60%.

HDFC Bank continues to be bracketed in bucket 2, under which it will have to maintain a higher CET1 by 0.40%. The largest private sector lender will thus have to double from the current 0.20%.

ICICI Bank is classified in bucket 1, wherein the second largest private sector lender will have to maintain an additional 0.20% in the CET1 buffers.

The RBI said the classifications are based on data collected from banks as of 31 March 2024.

The RBI had first announced the framework dealing with D-SIBs in 2014 and tagged SBI and ICICI Bank in the list in 2015 and 2016.

In 2017, it added HDFC Bank to the list along with the other two banks.